Apple and Nvidia led a sell-off in technology stocks on Monday as US recession fears and Berkshire Hathaway’s decision to cut its stake in the iPhone maker punctured a months-long rally in the sector.
High-performing shares of Alphabet, Amazon, Meta Platforms, Microsoft, and Tesla fell as much as 12.2 per cent in pre-market trading.
The losses in the Magnificent Seven stocks were set to wipe out nearly $1 trillion from the combined market value of the companies.
Chip stocks, the big winners of Wall Street’s picks and shovels trade for AI, also tumbled, with Advanced Micro Devices, Intel, Super Micro Computer, and Broadcom falling as much as 10.3 per cent.
The share slide followed a weak US payrolls report on Friday that pushed investors to safe assets and spurred bets that the Federal Reserve will have to soon cut interest rates to aid growth.
“Expectations have arguably become too high for the so-called Magnificent Seven group of companies. Their success has made them untouchable in the eyes of investors and when they fall short of greatness, out come the knives,” Dan Coatsworth, investment analyst at AJ Bell, said.
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